India may sue Germany for undelivered LNG Bloomberg

Russia’s Gazprom’s former Berlin subsidiary has cut supplies to New Delhi’s state-owned natural gas company

Diplomatic disputes have erupted between India and Germany after Germany bought a former Gazprom subsidiary and halted LNG shipments to the Asian powerhouse.

Gazprom Germania, a former local subsidiary of the Russian gas giant, changed its name to SEFE (Securing Energy for Europe) and cut LNG supplies to India’s Gail in May. Under the sanctions, Gazprom cut gas supplies to his SEFE.

Gail had a 20-year contract with GM&T Singapore, the Singapore division of Gazprom Germania, to supply 2.5 million tonnes of LNG per year. According to Bloomberg, citing LNG importers’ association GIIGNL, the deal was still in effect after Berlin acquired her Gazprom Germania, meaning SEFE had to meet its obligations to Gail.

In September, SEFE’s Singapore arm said it could no longer fulfill its long-term contract with Gail and offered to pay compensation of 20% of the contract price for failed LNG deliveries, said Gail CFO Rakesh Kumar Jain. Last week, SEFE said it had canceled a total of 17 LNG shipments since May.

Bloomberg sources say Indian companies have been forced to spend much more to buy gas on the spot market, so India is now looking for alternative gas suppliers for SEFE to meet its obligations to Gail. It has also had to cut supplies to customers and reduce production at petrochemical plants due to LNG shortages. The company has also turned down offers of compensation for undelivered LNG because it prefers to retain rights to canceled cargo, Reuters reported Friday.

Bloomberg sources say diplomats from both India and Germany have been involved to resolve the dispute. Sources said a diplomatic resolution would be preferable for both parties, but Gale has also consulted legal counsel about arbitrating his contract with SEFE, which could lead to litigation. It means that you have sex. Gale is also reportedly in talks with Gazprom to purchase LNG directly from the Russian company.

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( India may sue Germany for undelivered LNG Bloomberg

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